REPUBLIKA.CO.ID, JAKARTA -- The diversion of fuel oil subsidy to other productive sectors is in accordance with the government's vision to develop a maritime-based logistics system, stated Indonesian Logistics Association Chairman Zaldy Masita.
"Reducing the fuel oil subsidy by raising the diesel oil price to Rp7.5 thousand from Rp5.5 thousand per liter is necessary to improve the maritime-based logistics system," Zaldy remarked here on Tuesday (18/11).
He noted that transportation by sea is more expensive than land transportation as non-subsidized fuel is used for sea transportation.
"Thus, the target of Jokowi's government to move 30 percent of the volume of goods using land transportation, particularly along the Java's northern coastal highway, to the sea will be difficult to achieve if the trucks still continued to use subsidized fuel," he pointed out.
Zaldy expressed hope that in 2015, the fuel subsidy could be revoked to develop sea transportation with cheaper freight costs.
In addition, Zaldy also proposed that the government needs to ease the regulation on the import of diesel oil in order to offer the best price.
"Right now, the price of non-subsidized diesel oil is still higher than that in other ASEAN countries, and so in the long term, the elimination of fuel subsidy will make logistics more efficient," he explained.
The government, on Monday night, announced fuel price hikes by raising the price of subsidized gasoline to Rp8.5 thousand from Rp6.5 thousand per liter and the price of subsidized diesel oil to Rp7.5 thousand from Rp5.5 thousand per liter.
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